Finance Secretary Ralph G. Recto highlighted that the robust labor market in February 2025 signals a promising outlook for domestic demand, which will help shield the Philippine economy from global uncertainties and potential trade conflicts.
In February 2025, the country’s labor force participation rate (LFPR) rose to 64.5%, up from 63.9% in January 2025. Concurrently, the unemployment rate improved to 3.8%, compared to 4.3% in the previous month.
The underemployment rate also saw a significant decline, dropping to 10.1% from 13.3% in January 2025. This improvement reflects a shift towards more full-time, stable employment opportunities, with a notable increase in middle- and high-skilled occupations. Nearly two-thirds of the workforce were wage and salary earners, highlighting the expansion of the middle class and a growing shift toward formal employment.
“This is a highly encouraging trend. A strong and expanding workforce translates into higher incomes, increased consumer spending power, and sustained job creation. This, in turn, drives domestic demand and propels our economy forward,” Secretary Recto said.
He further emphasized the importance of nurturing domestic demand, especially amid the uncertainties fueled by brewing trade wars. “A resilient domestic market remains our best defense against external shocks,” he added.
In terms of sectoral performance, the services sector remained the largest employer, with a 61.6% share of the workforce in February 2025. It was followed by agriculture (20.1%) and industry (18.3%). The accommodation and food service sectors recorded the highest annual increase in employment, reflecting a surge in consumer activity as inflation pressures ease.
To build on these positive labor market trends, the government is pursuing targeted interventions to secure investment-driven job creation, foster a dynamic and innovative business environment, and diversify economic growth drivers.
One of the key initiatives is the accelerated implementation of the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act. This will attract foreign investors seeking to relocate their operations in response to changing global trade policies, ultimately creating more high-quality jobs for Filipinos.
Additionally, partnerships with the private sector will be strengthened to align workforce skills with industry needs through the Enterprise-Based Education and Training (EBET) Framework. This initiative aims to enhance workers’ skills and productivity, ensuring they are equipped to thrive in a rapidly evolving job market.
By focusing on these strategic priorities, the government seeks to ensure continued economic growth, anchored by a strong labor market that supports long-term resilience.
